why support immigration reform for independent entrepreneurs?

The US government makes visas available under the E2 Treaty Investor program to qualified foreign investors who establish a US business or plan to start a US business. E2 Treaty Investors are foreign entrepreneurs who invest in the United States. The E-2 Treaty allows a person who has invested or is investing in escrow, a substantial capital amount in a bona fide U.S. enterprise to enter the United States to develop and direct his or her enterprise. The E2 visa was designed to enhance or facilitate economic and commercial interaction between the United States and the treaty country.

As stated by Travel.State.Gov, You must be coming to the United States to:

  • engage in substantial trade, including trade in services or technology, in qualifying activities, principally between the United States and the treaty country; or

  • develop and direct the operations of an enterprise in which you have invested a substantial amount of capital.

so what's the issue ?

The E2 visa is a nonimmigrant visa. It does not give the investor a path to the green card. The visa was designed for an investor to come to the US on a temporary basis with the intent to return to his or her country of origin following expiration of the visa. There is no limit to the times that the E2 visa can be renewed. Visas are issued with a duration of usually three to five years with a maximum of five years when applying or renewing via the US consulate in the country of origin and with a maximum of two years when applying or renewing with USCIS. To qualify for an E2 investor visa, an applicant must own the business. In a corporate structure the investor must own at least 50% of the company's stock with a controlling interest.

no employment-based greencard if you own your own independent business

Per current immigration law, a US company that wants to hire a foreign worker can sponsor the prospective employee for a number of non-immigrant and immigrant visas employment based visas. However, if the business is yours or you own the majority of your company's stock you are no longer eligible for your own company to sponsor an employment based greencard for you. If you have USD 1,000,000 in your bank account, you can become an EB5 investor but owning your own company disqualifies your company from sponsoring a greencard application for you. You can sponsor other workers for visas and greencards but under the immigration laws are they are now, as a founder/owner you are excluded from the possibility of obtaining permanent residence for yourself. To be eligible for an employment based greencard you cannot own more than 50% of the sponsoring company's stock.

Investing $500,000 in someone else's project over which you have no control for the sole purpose of a greencard (EB-5 visa) is not something that resonates with most entrepreneurs

Running your own business can be challenging. You may achieve success early or it may take years of hard work and ups and downs.

I think you just have to work hard for about 10 years before you know what you’re doing...

— Ben Chestnut, Owner, The Rocket Science Group & MailChimp

Foreign nationals with the financial means to put $500,000 or $1,000,000 at risk in an EB-5 approved project are in an privileged position. Foreign entrepreneurs who can invest at least $1 million into a U.S. startup or existing business and create 10 jobs, are few and far between.
Unfortunately for many other prospective immigrants having $500,000 cash readily available to invest in a third party project - over which you cannot not excercise any control - is challenging to say the least. Paying rent, buying a home, supporting children's college education, having enough resources to be able to overcome a period economical downturn ; taking care of these day to day expenses consumes a large part of one's disposable income. Another factor is trust, are you comfortable, entrusting your personal funds, possibly your nest egg with an external project over which you have NO control just for the purpose of getting a greencard ?

Investing USD 1,000,000 of your own money into a U.S. business that generates 10 employment opportunities within a two-year period to qualify for permanent residence via the EB5 visa is within the reach of the very few. This is not a realistic scenario for budding entrepreneurs who often bootstrap for many years before succeeding. The positive aspect of the E2 Treaty Investor visa is that it accounts for cummulative investments made into the business.

America is known for its merit based reward culture. As quoted in The Role of Cross-Cultural Influences in Work Motivation : "Merit Based Pay systems that are common in the United States attempt to link compensation directly to corporate financial performance." Would it not be equally reasonable to reward entrepreneurs who contribute to the US economy with a path to citizenship ?

small business- tech and non-tech - is important to America

According to SBA, the 23 million small businesses in America account for 54% of all U.S. sales .

Applying for E2 visa renewal every few years is stressful, disruptive, and distracting. It’s also expensive, and displaces activities that grow the business — like business development, hiring and engaging in R&D.

Accepting equity funding from professional investors should be an option and not a requirement for budding entrepreneurs to earn a green card.

The Startup Visa is an initiative for technology entrepreneurs and fast growth startups whose companies secure equity funding from qualified super-angel investors or venture capital firms to secure green cards. It generated a great deal of support as the March for Innovation demonstrates. Those campaigns focus on foreign nationals who receive outside funding from professional investors. For some entrepreneurs, receiving outside funding can be the path to great success. It's not the silver bullet for everyone. Every time you get funding, you give up a piece of your company. The more funding you get, the more company you give up.

Building out the business prior instead of taking early stage outside investment places an entrepreneur in a stronger negotiation position. It can pay to wait. What's best, depends on the business model, technology, connections and personal preference of the individual entrepreneur.

Enacting legislation where a founder's only path to a green card is accepting funding from professional investors is not in the best interest of entrepreneurs. As remarked by Pascal-Emmanuel Gobry's in his 2010 article "Attracting investors shouldn't be the prerequisite for starting a successful company, it should be a consequence of it".

We actually never got any funding. We didn’t even take out any 2nd mortgages, or use credit card debt. We funded ourselves with paying clients. ...it’s what made us what we are today: a profitable, privately owned company with half a million users.

— Ben Chestnut, Owner, The Rocket Science Group & MailChimp

The ability to manage failure so that enterprises fail but people can still succeed becomes one of the tricks of how you build a society that can reinvent itself as the world changes.

— Shikhar Ghosh, Senior Lecturer, Harvard Business School

In connecting with community, influencers and law makers our message is that US businesses founded by foreign nationals are important to America - the startups and technology innovators and also more traditional and non-tech businesses.

About E2 Visa Lobby

we are a non-profit group seeking immigration reform for E2 Treaty Investors and other foreign independent entrepreneurs. We were founded on July 1st, 2013 in New York City.

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